It's easy to see the attraction: Action baby, Action!
Here's a post from 2016:
"Wang Bing has one word for you: rebar. Chinese rebar, to be exact. Chinese rebar futures, to be even more exact. He’s turned in a 2,100% return on the stuff over the past year-and-a-half, shorting the hell out of it late last year and then going long in the first half of this year."So what would make one give up all that?
Pork
Can you imagine the daytrading Chinese grandmothers:
UPDATE 3-China gets go-ahead to start trading hog futures
....MUCH MORE* Hog futures have been studied for more than a decadeBy Dominique Patton and Hallie Gu
* Contract expected to be physically delivered - source
* Comes after swine fever caused high volatility, market upheaval
* Go-ahead given amid growing pressure to boost economy (Adds detail)
BEIJING, April 24 (Reuters) - China is set to become the second market in the world after the United States to trade live pig futures after the securities regulator said on Friday the Dalian Commodity Exchange could launch a contract in the world’s top pork producer.
The new contract, which has been under discussion for more than a decade and awaiting a green light for three years, comes as Beijing tries to jump start its economy amid growing worries about a long and deep contraction.
China Securities Regulatory Commission said in a statement on its website that it would help players in its most valuable agricultural market - worth nearly 1 trillion yuan ($141 billion) - manage risk, while helping the sector to develop.
Farmers in China, home to about half of the world’s pigs, producing around 50 million tonnes of pork a year, typically face a highly cyclical market. The arrival of African swine fever in 2018, which killed millions of pigs and sent pork prices to record highs in October 2019, added to the volatility.
“It will provide a very good tool to hedge,” said a manager at a major pig producer about the new futures contract. “Pig prices are quite high now, but it will not remain like this.”....
Oh My God
It's going to make the Great Indian Guar Squeeze of April - July 2012 look like kids trading lunches:
Earnings Heads-up: "Guar sowing down in India, still time to catch up" (SLB; HAL; BHI)
With guar prices having risen from $1.50 to $25.00 per Kilo and with both Schumberger and Halliburton blaming guar for their Q1 earnings shortfalls and issuing warnings for Q2, all eyes turn to Rajasthan. (well mine, anyway)Well, you're probably ahead of me on how this plays out:
Indian market intelligence purveyor Three Headed Lion will sell you their 2012 Guar Gum Report: INDIA for $2975.
There's big money in guar.
Both BHI and SLB report tomorrow, Halliburton on Monday.
Since the Indian authorities suspended futures trading guar only trades physical. This morning's market report: GUAR: Guar and guar gum maintained their last close in thin trading....
September 2012
Fracking: India May See Record Guar Crop (HAL; SLB; BHI)
By October the autopsies were being performed:
Lessons From the Attempted Corner and Price Spike in The Guar Futures Trading Fiasco (HAL; SLB; BHI)
Of course the 17-fold move brought a bit of supply onto the market, as well as some substitution effects at the major frackers. From 2018's "Rabobank: "World Vegetable Map 2018"":
...Last I saw guar gum isn't even quoted in American anymore, it was trading at 9,345 Rupees per quintal ($146.37 per 100 kilos) with an open interest of 115 contracts for the expiring month.
I'm hearing good things about Chinese garlic though.
Something about a new use in silicon solar fabrication. No futures yet, you have to stockpile physical but for chart watchers there is a quasi-periodicity to the action.
As long as the neighbors don't complain about the aroma.
